Switching insurers could save county $60K [Columbus Telegram, Neb.]

May 24--COLUMBUS -- Platte County could net about $60,000 in savings by switching insurance carriers and taking on a bit more liability per insured employee.

The board of supervisors showed some interest in ending three years with the county's current stop-loss insurance carrier Companion Life Insurance Group, which would increase the county's annual premium by about $45,000, or 14 percent, and their annual liability by about $77,000, or 7 percent.

The figures were part of a county board address by Todd Drapal, senior account executive at OCI Insurance and Financial Services.

Drapal also presented stop-loss insurance bids from three other companies, including American National Insurance Company from Texas, which bid a policy with an annual premium 7.7 percent less than the current carrier and an annual liability almost 1 percent lower than the existing insurer.

All told, the supervisors stood to save about $28,000 by switching to the Texas insurer. If the county took on $5,000 of additional risk per plan, its total savings would be $60,577.

The discussion now moves on to the personnel committee, which is comprised of Supervisors Ron Pfeifer and Jerry Engdahl and chaired by Supervisor Hollie Olk.

Platte County, which employees about 160 people, funds its own insurance plan. An administrator handles claims, but the money to pay the employees' medical bills comes from the county itself as a self-insured entity.

To control the county's exposure to financial risk from claims, self-insured entities such as Platte County buy stop-loss insurance on top of that to cover any claims accrued annually over a specific amount, Drapal explained. Except for a few high-risk employees, the county is liable for no more than $45,000

Between July 2012 and April 2013, there were $935,887 in claims. Companion Life Insurance Group, the current stop-loss insurance carrier, paid what fell above the $45,000 limit -- about $232,000 -- leaving the county with 79 percent of the total claim amounts to pay.

With administrative costs, the county paid $1.04 million in claims last year, an amount below the maximum budgeted for claims, $1.2 million, and well below the National Association of Counties annual premium of $1.4 million.

The savings, $176,292, will be recycled into a county reserve account dedicated to health costs. This reserve account currently has $804,000.

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